Compose a 5000 words assignment on housing and construction cost escalation: a focused on saudi arabia. Needs to be plagiarism free! Certain factors were evaluated and analyzed to identify the major reasons for the cost escalations in the housing and construction industry in KSA. The factors that were analyzed include economic factors, geographic factors, demographic factors, social factors, and other environmental factors to provide accurate and reliable information regarding the cost escalations in the KSA’s construction industry. In the end, some strategies are proposed that could help the KSA’s construction industry to reduce its construction and housing cost.
With UAE, Saudi Arabia, Qatar, Oman, Bahrain, and Kuwait being a part of GCC, it was observed that construction contracts worth USD 50 billion were awarded to contractors in the very first quarter of 2011 (Deloitte, 2012a). The breakup of these contracts is given in the image below:
The Gulf Cooperating Council (GCC) flourished from the year 2003-2008 due to the spectacular increase in oil prices. With an increase in oil prices, the cost of construction also increased to about 60 percent particularly in Dubai (Meed Cost Indices, 2012a). In order to stabilize the economy to create a more balanced state, several projects were initiated with construction the major priority of GCC. The major hurdles for these projects were observed during the global economic crisis of 2008 where most of these initiated projects had to be canceled or kept on hold. However, with the recovery of the economy, it was predicted that the construction sector would be provided with outstanding growth opportunities in the forthcoming years (Meed Cost Indices, 2012a).
With the passage of time, the construction sector has shifted its focus from small and simple projects to more sophisticated and complex projects that require billions of dollars investment. Such projects involve complex civil work, electromechanical systems, and vital infrastructures to attract foreigners and investors.
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